tv The Profit CNBC May 21, 2017 3:00am-4:01am EDT
>> tonight on the profit... i'm going inside la dogworks, and upscale dog boarding facility that is on the brink of going out of business. >> take a guess on how much you made. >> i have no idea. >> $78. [woof woof] while i like the product and i like the process, the biggest problem here is how its abusive owner andrew rosenthal handles his employees. >> email me the [bleep] schedule! just do it! >> i'm gonna try to improve the owner and employee relationship before it's too late. >> i don't have to ask him time and time and time and time again! he doesn't care! >> my name is marcus lemonis, and i fix failing businesses. i make tough decisions... i will not do it if you're managing the people.
and back them up with my own cash. it's not always pretty... first time you ever emptied out poop? but this is business. i do it to save jobs, and i do it to make money. this is the profit. la dogworks is an upscale dog boarding facility located in the heart of hollywood, california. >> you're stinky dogs. >> founded by andrew rosenthal in 2004, this 24-hour full service center with 36 employees has everything from grooming to training... >> sit. >> in a state-of-the-art indoor dog park. this business generates $1.3 million a year, but recently, their numbers have started to tumble. sloppy business practices... >> i don't want to waste your time, and please don't waste mine. >> together with lax management...
>> there's inventory missing? >> well, you know, it's hard to tell, because stuff slips through the cracks. >> has driven down sales and piled up $150,000 of debt. >> you know, i could lose everything. >> if they don't make changes, this business will be forced to close its doors. nearly 50 million households have dogs. even in a bad economy, the pet industry is recession-proof. i want a piece of that. with the right changes, i can make la dogworks profitable and turn this into a multimillion dollar business in no time. >> so it comes up to $80. >> thank you. >> we'll see you next time. >> see you later, greg. >> marcus. >> how are you, andrew? >> very well. >> you have a nice place here. >> thanks. >> so how many square feet is this whole thing, front to back?
>> 7,500. we have boarding... grooming... daycare, training. >> sit. good boy. >> and we have our boutique. >> can i get a tour? >> absolutely! so this is the retail and reception area. >> is any of this stuff private label? you make any of this? >> no. [murmurs] purchased it. >> people buy it? >> yes. >> interesting. >> this is where we do our grooming. >> i go into the dog grooming room, and i notice that there's no signs on the outside of the building kind of detailing what goes on inside this facility, and i don't know how a customer's supposed to know we do. >> here's alyssa. >> how are you? nice to meet you. is that a customer's dog? >> yeah. >> how do you know how to price it? >> we price based on breed. condition of the coat is always a factor....depending on what they want us to do, if there's any special, like, requests... >> so do you kinda make it up? >> pretty much. >> okay. >> this is what i call the centerpiece of la dogworks. it's a 2,500-square foot indoor dog park. this is for dogs to play. >> very cool. and who's that? >> jesse, who is director of animal care.
>> how long has he been working here? >> seven years. >> hi, guys. >> hi, george. this is marcus. >> to go in and see the thought and the creativity that andrew put into this... it's very well-thought out. i'm very impressed. hi, guys. >> we call it the dog deck. it's a safe haven. if you notice the bunk beds i created--i invented these. i'm the first person to ever do this. >> you invented the bunk bed? >> for dogs--for use with dogs. >> [laughs] okay. okay. where are the sweets at? you don't have little sweets, individual sweets-- >> we don't do sweets. >> you don't. >> what we do--it's a two-story prefabricated kennel system. >> hey, buddy. >> some people have said that, you know, the chain link, you know, "my dog was in a shelter and it's gonna bring back bad memories." first of all, dogs don't think that way. it would never--a dog would never think that way. >> the first thing i thought of when i got my two cocker spaniels from a shelter...it has the same feel as a shelter. so maybe that's why people say it. >> well, people. not dogs. you build these rooms that look like human rooms--you think the dogs care about this?
>> but it's the marketing for the customer, not for the dog, right? i mean, it's how i leave the dog and how i think about it. >> okay. we do it our way, and it works really well. this is where we do training. emily is our director of training. >> are you emily? >> i am. >> hey, i'm marcus, how are you? >> marcus, a pleasure. >> really nice to meet you. >> and zoe. >> this is zoe. >> training is a very, very important part of la dogworks which fell off greatly. >> why do you think that is? >> you know what, la dogworks isn't for everybody. >> how does a customer contact you if they have a complaint? >> there's a website out there that people post business reviews, and we've had some negative stuff put up there, and andrew responds to it in his way. [laughs] >> what does "in his way" mean? >> so read it. you can read 'em. >> so here's an example of one. "i've been bringing my dog here for six months. one night, i came to pick him up. what i found was my pup wearing a muzzle, tied to a wall. my own dog--i was horrified." then your response was, "after questioning the staff, i believe them and not you." you told the customer that.
>> yeah. why? >> yeah, why? >> i-i call it like it is. >> andrew, stay the [bleep] off the internet, because you're... hurting your business. >> i don't think i'm hurting my business at all, personally. >> i'm a little worried about andrew so far. the vibe in the place isn't great. i've seen some stuff online, and his interaction with me, quite frankly, isn't that open-minded. so before i do a deal, i need to get a good understanding of these financials. >> hi. >> how are you? >> nice to meet you. >> what do you do here? >> i take care of the money. >> what do you have that i can look at? how 'bout a p&l? >> yes. this is april. >> okay. >> and this is 2012. >> so in this month, you know how much revenue you did? >> 120? >> 109. how much did you make on 109? >> i have no idea. >> $78. >> sales fell off greatly, and it--and it just hasn't blossomed to where it needs to go. >> grooming has been underperforming. training has been lagging. our top performer is definitely
boarding. this year, boarding's off quite a bit. >> what is your occupancy? >> what do you mean? >> we're gonna think about this just like a hotel-- number of beds, number of nights, the rate per night. that's how a hotel does a budget. they manage their business on some level of occupancy. if all of the runs and all of the beds were occupied, you would have $1,830,000. what do you think your level of occupancy is as a percentage of your total? do you know that number? >> no. >> you know that number? >> no. >> the maximum revenue that the kennel system could generate is about $1.83 if every kennel was full every night at a state of rate. last year, the kennels generated about $500,000. so very simply, i just divide $500,000, which is what they generated, into the amount that they should have generated, and i come up with an occupancy rate of 27%. that's not good. so the way i look at this, andrew, is you're at the absolute worst possible level
at 27%. >> we're off. >> what's your biggest challenge in your job...when you wake up in the morning? >> putting up with me. >> dealing with you? >> that's good. >> are you not easy to deal with? >> no. >> how come? >> because i'm very passionate about what i do, i know what i wanna see, i know how i want this place to run. and sometimes people tend to not follow the path and... >> does it make you crazy? >> yes. i don't walk around yelling every day. i walk around yelling when i need to. >> for me, if an employee doesn't work out, that's my failure, not theirs. if andrew's telling me himself that he's not good with his employees, i have to imagine that it could be much worse. hey, i'm marcus, how are you? >> hey, nice to meet you. rene, jesse's brother. >> oh, you're jesse's brother. what do you do here? >> animal care tech. >> okay. you like it? >> it's good. >> what do you love about this place? >> uh, just being with dogs, man. there's something that's always gonna love you every time you come in whether it's a bad day or a good day, you got a happy dog with you. >> how do you like working with
andrew? >> uh... it can be a little complicated to explain. >> seems like he gets a little... >> uh... you gotta work. >> yeah. all right, man, well, good meeting you. i'll be seeing you around. >> sounds good. >> all right, buddy. hey, jesse, can i grab you for a minute, bud? >> yeah. >> jesse's the park manager, and he's a critical staff member. i mean, he's running what i consider 50% of this business, the center of the business. so you and i haven't had a chance to talk or anything. do you wanna be here long-term? >> actually, yeah, i love it here. i mean, i been here seven years now. i mean, i been probably the longest one here and worked every shift imaginable here. i mean, i know the place inside and out. >> how do you like working with andrew? i have to tell you, it seems like you work hard, you're positive. >> oh, i mean, i have to be. you have to be. >> all right, thank you, buddy. >> come on, sooks.
>> neil? marcus. >> marcus. nice to meet you. >> nice to meet you. what would you say would be the single biggest problem in the organization? >> it starts at the top. it's a really dynamite facility with a well-thought out system. but i don't think andrew is rational. >> yeah, erin told me he flies off the handle...[snaps]... in a nanosecond. >> he has had several explosions in the past few weeks. >> why would someone like you put up with stuff like that? >> i love the animals, but i have my limits. man-to-man...i'm planning my exit. >> are other people too? >> yes. >> and why do you wanna leave? >> one of the biggest reasons is i got bit recently. andrew literally got in my face and yelled at me and blamed me for it. >> in front of other employees? >> yes. and that's the thing. i mean, everybody else responded like normal people would. and if it weren't for that, i'm not a violent guy, but i would have probably left here in handcuffs and andrew in an ambulance. >> i thought we could maybe just
go into the training room and talk. >> now? >> is that all right? >> yeah, sure. >> i came here to do business, and instead of focusing on business, we're focusing on him yelling. yelling at employees could be the most inexcusable behavior of any kind, and if i'm gonna make a deal with this guy, there's no way that i'm gonna let andrew interact with his employees once i'm here. i looked at 600 businesses, and i like this concept. i'm willing to write a check... >> mm-hmm. >> and fund what i think needs to happen. >> mm-hmm. >> i'm not willing to do it-- i will not do it--if you're managing the people. you don't really necessarily... like people. >> i mean, that's a very broad statement, because i really am good with people, it's-- >> you're not as good as you should be as a business owner with people. >> maybe i don't handle my staff well, if--if that's what you're saying. >> i'm saying that you don't handle your staff well or your customers as well as you should. he's got a great concept here, and i think i can take this concept and really scale it across the country. but i'm gonna put a very tight leash on him, and i'm gonna keep
him away from the customers and the employees. >> why do you want la dogworks? >> 'cause i like the brand, and for me, it's creating products and services under the la dogworks brand that are scalable and that are sold in mass retail, online, and opening up multiple locations. we're only gonna open up new locations when i'm confident that this location is functioning the way it's supposed to be...including the morale. >> okay. >> andrew, i'm gonna offer you $1 million. >> for... >> i want 50% of the business, you and i are gonna be equal partners. i'm gonna control the operations of the business, and you will have no authority over the employees, and you will control the brand. >> but this is a business that i built, that i came up with, and now i'm gonna share that with somebody who i don't know. i don't know that i wanna sell 50% of my business for $1 million. >> well, that's my best offer. you made $78.17 last month. >> mm-hmm. >> do you wanna take this business to the next level? >> absolutely.
>> do you wanna be relieved of the burden of dealing with your people? do you wanna open more stores? >> mm-hmm. >> i'm offering you $1 million to do that. what i care about in this moment is you and a business that i think has a [bleep]load of potential. >> mm-hmm. >> coming up... >> if you're happy, the customer will be happy. if you're unhappy, this place is out of business. >> i trusted people to manage. >> that's not fair. >> what are you talking about? >> don't even go there. >> just do it!
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>> what i care about in this moment is you and a business that i think has a [bleep]load of potential. >> mm-hmm. >> the $1 million offer that i make andrew isn't just to have andrew put a million dollars in his pocket. no way. the $1 million offer is very simple. another $150,000 to put working capital in the business. and then $700,000 for any expansion opportunities. those expansion opportunities are not gonna happen until this place is right. i'm gonna want to have complete control for the next week so that i can get the employees in line, get their process in line, and tell them that you don't make any decisions. i make the decisions. if, at the end of this week, you can't do what i think you're supposed to do and this place
doesn't function well, the deal's off the table. >> i don't want ever to have to worry about this business suffering... or not having enough money to pay my staff or not having enough money to pay rent. >> i wanna fix the business. i wanna transform parts of it that i think we can transform together. but i need to know that you can transform yourself. you gotta let me help you. >> [ahem]. okay. >> let's go to work. we're shaking on making this work for both of us. but i wanna be clear. >> yes. >> if you mess with any of these employees, i will fire you. for those of you that have not met me, i'm marcus. i wanted everybody to know that andrew and i have come to a deal. over the next week, you're going to see some significant changes, but the most important thing we're gonna work on is management. there's over 30 people working here, and they rely on this business to survive.
so in that instance, they'll take abuse...until somebody steps in and stops it. and i'm gonna be that person. the days of people being yelled at and demoralized and morale being this low are over. if you're happy, the customer will be happy. if you're unhappy, this place is out of business. you're not gonna be out of business on my watch. we need to raise revenue in order to make money around here. we're gonna get very, very clear about the process. we have to increase occupancy in the kennels. we have to create a loyalty program that allows customers to be rewarded for using our different products and services. my other goal is i wanna open up more locations, but we cannot do that...we cannot do that unless this one is right. we have to expand the retail product selection by developing private label products. all of the staffing, morale, all of that-- >> is my job. oh, sorry. >> you guys are gonna be reporting in to me. all right, let's get back to work...okay?
[energetic music] ♪ hey, i'm marcus. >> stefano. >> stefano, nice to meet you. you're here to talk about the painting? >> yeah. >> i'm looking just to accent stuff. >> right. that wall right there and this wall right here could be your accent wall, as well as that one right there. ♪ >> in order for me to move forward with my marketing plan, i wanna see any and everything that andrew has. so andrew wanted to take me back into the garage to show me his delivery vehicle. oh, this is cool. >> this is the fetchmobile. >> they wrapped and the whole deal? >> uh-huh. and look. and look, and look. >> well, i mean-- >> no. >> wait a minute. >> there is no "well." >> it's a scratch. so a team member did that? >> yeah. carelessness. >> it's called an accident. i mean, andrew, you do understand that things happen, right? >> oh, i understand, but not constantly. >> the question is do you have enough patience and tolerance to educate them, to train them, to forgive them? >> [scoffs] i have seen my employees whittle
away at the integrity of la dogworks...by stupidity, by laziness. by not--not coming to work. you hire people...and that's where your problem starts. the personalities, the laziness, the bad work ethic-- all these variables drive me crazy. how many times do i have to ask you to do something? how many times do i have to ask you? it's like the water torture-- boom, boom, boom. we're working together here, we're a team, we're a hierarchy. we're just like the dogs. who's the top dog, who's the alpha male? me. you gotta do what i say when i say it. i mean, if i could fire the entire staff and start from scratch, i would do that too. >> so who wrecked the van? >> well, neil. >> what do you do, just yell at him? >> i don't talk to neil, as a matter of fact. >> why? you don't like him? >> i hate him. he's a [bleep]. he's a--i'll give you $8.50 or $9 worth of work and not a [bleep] penny more and not any more effort.
okay? that's neil. >> when he got bit by the dog and was bleeding, were you concerned about him or the dog? >> ha ha ha ha ha ha ha ha! okay-- >> andrew, i gotta tell you-- your laugh scares the [bleep] out of me. >> because it's a farce. what neil did was reach down and push the dog back, at which point, the dog bit him. >> it sounds like he was just trying to stop the dog from running in the street. >> i was horrified. why--why would you do that? >> as andrew's ranting and raving, neil walks in. instead of andrew using some sort of decorum or discretion or shutting his mouth, he continues. he actually gets even more amped up. >> and then he comes up to my office yelling and screaming at me that i should have shown more compassion. >> but i think when that happens, i think what people are looking for is some level of sympathy. >> that's not--again, my staff has to function a right way. >> i know. >> when neil started working here, and i told him to this-- to his face--i had big hopes for him.
>> when you say that to somebody, "i had high hopes for you..." >> neil did not hear that from me until we had a huge argument in the kitchen when he got in my face with his wide eyes-- >> i-i got in your face? >> you don't remember that? >> i don't remember it that way. >> well, my back was to the door and you were standing here staring me down and i said, "who the [bleep] do you think you are staring me down?" >> [inhales] >> don't remember that? >> i remember it differently. >> okay, well... >> in that instance where he pulled the dog--did you think neil was out of line? >> no, not out of line, just doing a stupid thing. he just did the wrong thing. a thing that nobody else would do. >> have a good night. >> okay--no, no--is there a problem? [dogs barking] he's gonna get fired anyway. >> why's that? >> because i [bleep] can't stand him. he's insubordinate, he's obnoxious. don't let him manipulate you, because i'm telling you, he is just worthless. absolutely worthless.
>> we need to gather everybody together. we need to talk as a group now. as soon as i saw the extent of andrew's rage for his employees, i realized i needed to get all the employees together immediately. this is the time--this is like a group therapy session. i mean, listen, a lot of times things can be solved if people can just talk them out. it's impossible, andrew, for you to dismiss how these people feel anymore. you can't do it anymore. >> i don't dismiss. >> you do. >> no, i don't dismiss. >> i'm sorry, but you do. >> no, i don't. >> i'm sorry, but you do. >> no, i don't dismiss. >> you don't try to empathize or feel what they're feeling. everything is just--handle it. do it, fix it. >> for me to get you guys to do things wasn't always so easy. >> 'cause we had other things to do. >> there's always something to do.
>> you're saying the whole problem was we had no organization, things weren't getting done that you wanted us to get done. but you expect three people to take care of 50 dogs a day plus do drop-offs and pickups, making sure they get medication, they get their food, and we clean the whole building. all that stuff with three people is not possible. >> we all have to make things work. >> no, i know, but-- >> utilizing our time properly. >> you focus so much on what doesn't get done that it makes people feel that they're worthless. you complain about having to pay anybody anything, and people work really hard. i feel you dismiss it. it's just--it's not-- >> okay, you're incorrect in your feelings. i have tried, and i've tried to communicate, and i'll tell you something--it doesn't work all the time. >> they're scared of how you're gonna react. >> and that's a big one too, 'cause a lot of people see you ranting and yelling at me when i'm inside dog area, so then you're just like, "oh, [bleep], i'm not gonna go talk to him." people avoid you. >> everybody here knows my personality, knows the way i am. i'm a reactionary, okay? i'll yell and scream, and then it's fine. >> yeah, but i mean, for you. >> and that's what i need to do for my health. >> and for my health, i'm sorry, it's not working, 'cause i'm stressed out--i go home stressed as hell, dude, i don't
see my wife as much, 'cause i have to do these extra hours. you don't think i work enough. this job has really stressed me out. >> that's not true. >> andrew, you gotta listen-- you're not listening! >> i listen to everything. >> no, you're not! does he listen--yes or no? >> no. >> it's okay. you're frustrated, right? >> yes. >> okay, just tell him how you feel. he's not gonna get mad. >> i'm listening. >> okay. go ahead. >> it's our livelihood here. [crying] and it's just never been considered. >> emily, what does that have-- >> we're working so hard. >> but explain what's been going on so marcus understands. >> no, no, i understand. i want you to understand. >> no, no, you don't understand. >> no, because-- >> you don't understand. >> what do you mean, i don't understand? >> 'cause you don't know the history of what's gone on here. >> the history is the people that work here don't [bleep] wanna do it anymore! that's what matters. >> that's the easy way out. that's the easy way out, marcus. >> you know what the easy way out for all them is? what's the easy way out? >> leave. >> what's the easy way out? >> to leave. >> what's the-- >> i quit. >> to leave. >> to leave--that's their easy way out.
and then you'll be totally up [bleep] creek. >> now, that--that's ridiculous. >> i'm not gonna let these people suffer because you're a [bleep] communicator. we're gonna fix it. they are loyal to you for some crazy reason. i have no idea. but i'm surprised they all haven't left. andrew continues to be ignorant to the fact that these employees have something to say. he doesn't seem to understand that these are real people with real feelings who have a passion for his business...and that these people, if treated properly, will make him a lot of money. we are gonna leave the past. we got a lot of work to do. let's you and i spend some time together. guys, thank you, okay? >> no, no, no, no. no. i didn't like being ambushed today. you know, it's kind of like when somebody falls or somebody gets knocked down and then you kick them and then, oh, look, and then the next one kicks them and they're kicking and then i'm
like, "whoa!" you know? enough is enough. i created this business... and i showed everybody how to do it. this is my happiness. >> i'm gonna make you the best business owner that's ever lived... >> thank you! >> but you have to shut up once in a while. and let 'em just talk. >> it's so difficult for me. i'm sorry. >> it is, but what's the disadvantage of letting them get it out? andrew has what i call delusions of grandeur. he thinks he's bigger and better than he actually is. he has no respect for his employees, and the smallest of things set him off. instead of counseling his employees and teaching them and training them and being a good leader, he's just an angry man. can i have a few minutes by myself, please? >> sure. >> this guy's a [bleep] lunatic. [laughs] >> where's jesse?
>> he's not here. >> he's off today? i came into the business this morning hoping to have a fresh start, hoping to really develop all these great plans. instead, i walked in to some really big problems. >> jesse quit. yeah. he was having a conversation with erin, and he got up and quit. i made a decision-- >> what happens if all these people quit? >> then we hire new people. >> andrew, you're still struggling to see that these are people. you're managing them...like servants. and without them, we're closed. this is a moment that i've worried about, and i've warned andrew about this. if people aren't treated properly, they're gonna rebel at some point. and what i'm starting to sense is there's mutiny about to happen at this place. [dramatic music] ♪ >> talk about jesse for a minute? >> okay. >> can we have jesse come in? >> what? >> sit down and talk about all this? >> why? >> because i think it's unfair
that he left...without having a chance to say anything. >> jesse has emailed me the schedule three or four times in the entire time he's worked here, okay? he refuses to do it. >> he's been a dedicated employee who has-- >> he hasn't been. >> yes, he has! >> he has not been. dedicated to who? who is he dedicated--not me! >> we're not all here for you! we are here for this place! >> then we'll never--then-- then--no, no, no, no. i'm not gonna put up with that. jesse failed miserably. he wouldn't listen to a [bleep] thing i said. [shouting] i don't have to ask him time and time and time and time again! email me the [bleep] schedule! just do it! >> that's the answer to everything--just do it. >> well, just do it! when you do it, do it. >> and again, we've had this talk--the false threats, and this and that and yelling and screaming gets nowhere because people don't take it seriously-- >> i trusted people to manage. >> that's not fair. >> what are you talking about? >> don't even go there. >> i'm not going anywhere. >> that's a waste of--
>> i'm very excited about all these ideas that we have for la dogworks. but i continue to be concerned about andrew's behavior. when i get voicemail messages that sound like this: >> hey, marcus, this is neil. i'm calling to ask if you can hire me into one of your other businesses--i don't even care. whatever you got. i'm distressed at the harassment level. it's just getting to be overwhelming at dogworks. >> so i decided to bring in dr. rivera, a workplace psychiatrist. i've worked with her in the past, and she's been very successful in helping create common ground between employees and owners. >> hey, marcus. >> hey, how are you, dr. rivera? >> how are you? >> good to see you again. >> good. how are you? how's everything? big sigh. >> yeah. this is a big challenge. let me give you a little tour, introduce you to a few people. >> okay. [dog yipping] isn't this beautiful? >> wonderful! yeah. >> hi. >> how are you?
>> i'm andrew. >> i'm erica. >> hi, erica. >> nice to meet you. >> pleasure. >> andrew, this is dr. rivera. she's worked with me in other companies in trying to help bring people together. so-- >> ha ha ha ha ha ha i'm kidding. >> i thought maybe the three of us can go back and chat. >> sure. >> i think my biggest concern is to help him manage people. it's not a thing that he loves to do. >> employees have been the bain of my existence. >> okay. i hear you say bain of your existence, and in our discussions, we think about employees actually being the key to a successful business. your employees need to know that you trust in them, value them, and believe in them...or it's gonna cost you. in the bank, it's gonna cost you. >> there's one person here that i thought it would be helpful for him to be brought into the equation for you to interact with him in his presence... >> okay. >> and to watch the visceral reactions that bubble from both. >> right. >> because if andrew can learn to work through this particular one, i think he's got the potential for being an
amazing...amazing business owner. let's go see neil. if dr. rivera can find some common ground between the employees and andrew, we are well on our way to making a lot of money. this is neil, buddy of mine. >> hi. ni, neil. it's nice to meet you. so andrew, can you tell me what qualities you see in neil. >> i don't see anything in neil now because he doesn't exist. we had a falling out, and i wouldn't say i'm a grudge holder, but i'm a grudge holder. >> so what's been going on with you and andrew? >> there was an incident. i got bit by a dog. this dog started charging out of the run. my first instinct was, "protect this dog from running down the street," and the dog latched onto my arm and literally he said to me, "well, look how you're handling the dog!" and i was like, uh--uh--you know, i mean, it's like-- damage control. >> i said what are you doing? is what i said. >> neither of those statements any way to me sound like they have any, um, level of concern in your employee's health, though. let's be honest, right? this is important, because neil,
you felt you weren't being taken care of by your employer in that moment. >> well, when you work in a place like this, biting can be inevitable with that many dogs, but it's just how you handle it. i went up into the office and i said, "next time i get bit, please show some compassion." at that point, he started screaming at me, and he was being so toxic and hostile in my face. >> that's not what happened at all. he was very angry and... really challenged me in front of people. and i said, "what is your problem?" and he goes like this... >> [whispers] oh, my god. >> not oh, my god. not oh, my god. >> i did not get in his face. this is the energy that i had when he was screaming the f word in my face. "what the [bleep]--" it just--there was no stopping it. >> that's not what i said, you fricking moron! >> for business advice and extra scenes from the show, go on to...
>> that's not what i said, you fricking moron! >> you just threw a pretty rough insult at neil. >> that's--i don't care! i have heard more stories about neil and neil complaining about this and calling me names and i'm quitting and he's out of his [bleep] mind and nah, nah, nah, nah, nah. you say the wrong thing to him and it's, "holy [bleep]!" >> i'm thinking that probably this isn't the first insult you've gotten, neil. so i'm wondering...wow! neil, why are you here?
>> he told me he was quitting. >> are you waiting for that? >> i'm not firing him. >> why not? >> 'cause i don't deal with him every day. he does his job. >> he adds value as an employee. >> he adds value as an employee. >> okay. so you don't have an intention of firing him. >> i never did. >> there's just a difference of opinion about a lot of things, and, quite honestly, it's his responsibility... >> to what? >> to make it work--not his. neil, i'm sorry. is there any way we can move past this? how hard is that? >> well, maybe we'll do it another time. >> why another time? >> because maybe it--it'll be real. i don't want-- >> you don't need to use marcus's words--you use your own words. >> let's go ahead--i'll help you with dinner, neil. talk to andrew.
he needs to learn that it's okay to say, "i'm sorry." who's gonna teach him? i can't help--i need your help because he's never gonna move on, ever. >> right. >> slack, slack, slack. how many times do i have to ask somebody to do something? it's gotta stop. >> so one of the important things i heard was marcus talk about the qualities he sees in neil. i feel like you really need to hear that. >> i see qualities, and i've told him i see qualities in him. >> let's hear it. >> i see qualities in you. and i told her that. >> come a little closer, neil. >> that--that's enough. >> that's not enough. >> no, that's great--no, that's stop--over the line. >> that's great. >> stop it. >> [laughing] >> is this-- >> stop. stop. if you put your arm around me, you're doing it because you really mean it...and you really want to make amends. if you really want to make amends, i can deal with it. >> okay. >> okay? i'm willing to... open myself up to you if you're willing to open yourself up to me. >> all right. >> do you want to shake hands? >> yes. >> when i accepted his apology,
when i apologized to him, did i mean it? absolutely. the one thing i will say for neil is he would never do anything to hurt a dog, and that's all i care about. i am exhausted. >> after andrew made up with neil, we went into the training facility and he had what i would call a human moment, one that he doesn't have very often, where he was reflective and he realized the pain and suffering that he has caused to other people. >> after la dogworks opened, so many people came up to me and said, "you did it." whew. >> feel proud, right? it's a proud moment. >> i honestly felt people worked really hard. everybody pitched in, everybody...pulled their weight. i mean, it was really a beautiful thing. somewhere...things fell apart after that. >> who are the employees, if you
had to guess, who are the employees you think you've hurt the most emotionally? in reflection. i want you to reconcile with the people that matter, and somehow that same resolution that you had about pulling people together and everybody striving for a common goal--we are at that point as we sit here right now--that that same tenacity, that same will to win, that same energy that you used is what has to happen right this moment. you have to. >> absolutely. that's my dog. oh, my boy. >> between what happened with dr. rivera and his breakthrough with neil, i'm now watching him actually pitch in. i think he realizes that if he
does the job of the rest of his employees, he'll have a better appreciation, a higher level of respect, and a better understanding of what it takes to work here. >> felicia's water. >> felicia's water? >> yeah. [dogs barking] yamma coming in. go on. >> now that things are starting to look up and i'm noticing a change in andrew's attitude, i wanted to take him out front and show him some of the changes that i've made to the front of the store. the building has been repainted. we had a lot of the holes patched, and we added these things. >> it says grooming... >> grooming and training. >> looks very nice. >> we needed to tell people what we do. the lighting's all working. the flags are all up, and it looks good. >> i think it's brilliant. >> did you see the logo inside? let me show you that. this logo that was made came out great. >> i love it. >> it is very beautiful. >> that's great. >> i think that is a spectacular logo to be on the business cards
with the grooming department. i mean, it's fantastic. >> beautiful. >> i also had some private label products marked up so andrew and the team can see the kind of ideas that we have and the kind of products that we can take to market. when we first met, i talked about ways to kind of make the brand bigger and stronger. these are nothing more than mockups. but i'm looking for products that are approved, that have the la dogworks stamp of approval. so the first thing i had created... is a new pet fence. this is more of a mass marketed product. you like that? >> yes. >> it's pretty nice. >> it's a very useful tool. it's also great for training dogs. >> this is a foldable pet bed. >> it's a cot, it's a dog cot. >> yeah. >> i like that. >> that's a good idea. that's great for the summer. >> a little portable pet drinker. so whether it's this or 20 other things or 30 other things, as you open up more locations across the country, la dogworks products will be sold there. and it'll also be online. >> here, come here.
>> see, the beauty of this relationship is being able to collaborate and make stuff like this and take it to the mass market. that's what i think's great. coming up... >> i can make this business work with or without you. >> you don't know how to treat people. >> oh, yeah, i do. >> no. >> oh, yeah, i do!
>> look, in the last week, we've done some things--at least we've tried to. we've painted the front of the store, we've re-branded the retail store, we've worked on ways to improve the efficiency of the grooming department. look, we're at the point where andrew needs to get very focused if his business wants to survive. one of the things that i wanted to do is talk to you about the boarding. i had an idea that may or may
not work, but if we went to animal shelters in the greater los angeles area and we said for every individual or family that adopts a pet, your first grooming or your first training or your first boarding is complimentary. that's our gift back to you for loving dogs as much as we do. although it's a great thing to do for the community, it's also a great way for people to come in. i would call it a loss leader. does that make sense? >> yeah, you're absolutely right, but this has all been discussed before. >> but it didn't-- >> it's all been planned before, and it was attempted... follow-through. i can't ask somebody 10 times, 20 times to do something when people aren't following through. >> i'm not sure i understand. >> there are employees that work here, okay, and a lot of them aren't meeting the mark. >> okay. i don't get it. look, i see great possibilities with this brand and this business, but andrew can't get past blaming everybody else for every single mistake that's made. >> the people that need to go need to go.
the people that are causing the problems need to go. >> how do you feel about that? >> i'm just listening for right now. i'm not sure what to say at this point. >> if i have to come up with new--new rules every day to get people to function properly, that's wrong. >> no, it's called the evolution of business. things change. >> no, no, no, no. no, no. >> so your solution is to get rid of all the people because they all suck. >> what people? the staff? >> us people. >> ha ha ha ha ha ha ha ha ha! i'm not a moron. and i can make this business work with or without you. this isn't good sam, this isn't camping world, this isn't-- >> you know why it's not? if this was good sam and camping world, your [bleep] would be outta here. >> why don't you let me finish-- >> don't bring up my business ever-- >> i'll bring whatever i want to. >> i treat my people the right way--you don't know how to treat people. >> oh, yeah, i do. >> no. >> okay, i have changed. >> oh, my god. >> okay, i have changed. i know what i have to do and i know what i have to see happen here in order for la dogworks to-- >> oh, my god, you don't though,
you keep saying that, over and over and over again. all i've heard for the last year is about getting rid of this, that, and the other, andrew, and you've never done it. i'm sorry, you've never done it, and you lambaste a lot of hardworking people who come in here and they work their [bleep] off. there are a lot of good people who work here. everybody ensures the safety and well being of these dogs every day. >> that's bull[bleep]. >> we've had a lot of great staff who've come through here, and a lot of great people who've left because of you. >> because of me? >> because of you. >> not true. nobody's left for that reason. >> you are so full of [bleep]! i'm sorry. no. >> you are in such denial. >> no, i'm not. you are in denial, my friend! no. you are. >> absolute bull[bleep.] you know, i'm just not in the mood to do this right now. you with me? are you with me? [dog barks] are you with me? that doesn't do anything for me. okay.
i had a partner many years ago. the only reason my partner is alive is because murder is illegal. okay? so...i don't do well with partners. i don't think i'm a bad person. i don't think i'm a bad boss. i just--i have animals, you know? it's not like i own some [bleep] camping world... you know, camping store where somebody puts the tents where the skis are. nobody's gonna die, nobody's gonna get sick, and nobody's gonna get hurt. so...it's a big difference. anyway. we're on camera right now. i just noticed. >> this level of unpredictability is too scary. i can't move forward and do business with somebody that cannot treat his people right. the $1 million offer that i made to andrew--that deal's off the table. i won't be a part of it.
lemonis: tonight on "the profit"... andreas: meat in the gyro? lemonis: ...my big fat greek gyro is a small franchise with a growing footprint. are you guys still in love with this business? -mike: i am. -kathleen: i am. lemonis: already, there are five locations up and running. -how long have you been here? -jace: a little over 3 years. lemonis: and as the business has grown, so have the problems. mike: you're my partner. you can pick up the slack, as well. kathleen: you're gonna put it on me now? lemonis: husband-and-wife team who started it have no idea how to run it. rich: i've lost respect for mike as an individual. lemonis: their food misses the mark. they're actually terrible. andreas: you don't like them? lemonis: no. their branding is all over the place. hamburgers and hot dogs? and the franchisees aren't getting anything close to the help they need. kane: the only help we ever got from them was on the first of the month, they came and picked up their royalty check. lemonis: for this business to survive,